Why does pharmaceutical centralized procurement need IP protection so much?
A single innovative drug can cost hundreds of millions to develop over more than a decade. Once it enters volume-based or platform-listing procurement, thousands of medical institutions purchase it at once. If infringing or counterfeit products slip in, rights holders suffer huge losses and patient safety is at risk. Historically, IP and healthcare-security authorities worked in silos, with poor information sharing and slow takedowns.
In December 2022, the China National Intellectual Property Administration (CNIPA) and the National Healthcare Security Administration jointly issued the Opinion on Strengthening IP Protection in Centralized Pharmaceutical Procurement (the “Opinion”), linking the two protection chains at the national level for the first time.
Why did the two authorities join forces?
The two agencies already cooperated on sharing IP information of procured products and efficiently handling infringement disputes. The Opinion institutionalizes this practice, implementing the State Council’s requirement to improve the IP protection mechanism for pharmaceutical procurement and build a coordinated information-sharing mechanism.
What protection mechanisms does the Opinion build?
1. Coordination and daily liaison
Articles 1–3 establish a consultation mechanism, liaison offices and information sharing: local IP and healthcare-security departments are guided to broaden communication; the IP Protection Department of CNIPA and the Medicine Price and Procurement Department of the National Healthcare Security Administration serve as daily liaison offices; for drugs and medical consumables involving IP in centralized or listing procurement, the parties notify each other of product and IP information.
2. Enterprise self-commitment, ex-ante prevention
When joining centralized procurement or applying for platform listing, enterprises must voluntarily commit that the relevant products do not infringe IP rights, moving risk prevention before market entry.
3. Efficient, lawful dispute resolution
Procurement agencies may inform parties to request IP authorities to handle the case or sue in court; authorities handle cases efficiently. Agencies verify qualifications against published information and promptly remove clearly infringing products.
4. Post-case linkage and key-product analysis
After a case closes, IP authorities send the documents to healthcare-security authorities: products under listing application are barred, and listed or selected infringing products are removed or disqualified. For large, high-profile products to be procured, the two agencies exchange IP information and strengthen risk analysis for reference.
Practical implications for enterprises
Frequently asked questions
Which procurement scenarios does the Opinion cover?
It covers drugs and medical consumables involving intellectual property rights in both volume-based centralized procurement and platform listing procurement.
What IP commitment must enterprises make to join procurement?
They must voluntarily commit that the relevant products do not infringe any intellectual property rights, as a precondition for participation.
What happens if an infringing product is found in procurement?
Clearly infringing products are promptly removed from the platform; those already selected are disqualified, forming a “detect-and-stop” loop.
Which bodies lead the inter-agency consultation mechanism?
The IP Protection Department of CNIPA and the Medicine Price and Procurement Department of the National Healthcare Security Administration act as daily liaison offices.
Source and further reading
This article is based on the policy interpretation of the Opinion by the China National Intellectual Property Administration (CNIPA) (original link, 2022-12-30). It is for policy interpretation only and does not constitute an official interpretation or legal advice.
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This article introduces the intellectual property system of the People’s Republic of China (China). For the latest official rules, please refer to the competent authorities.